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Year-End Tax Planning: Don’t Miss These Deductions

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September 30, 2025

Seed-stage companies and small businesses may not have the resources to hire a full-time CFO; however, they do not have to go without strategic financial advice. Salient, an early-stage software company, wanted a virtual CFO to help build a financial model and forecast so it could better understand its cash runway. They needed to identify the impact of hiring additional team members, obtaining grant funding, venture debt, and landing customer deals. Not only was Salient seeking a vCFO with a modeling tool sophisticated enough to run side-by-side scenarios, but they needed a customized approach – that’s where Execor stepped in. They needed to identify the impact of hiring additional team members, obtaining grant funding, venture debt, and landing customer deals.

Organize Your Records

Start by updating your books: reconcile bank and credit card statements, categorize expenses, and make sure you have documentation for everything. A clear picture of year-to-date income and expenses highlights where you can cut taxes. Accounting software can help run reports showing spending by category.

Double-Check Deductible Expenses

Review the biggest categories of business deductions so you don’t overlook them:
– Equipment & Supplies: Any business-related purchases (computers, printers, tools, furniture) can often be deducted. Many places allow immediate expensing for small equipment, so consider buying needed items before year-end. If a purchase is large, you might depreciate it; smaller-dollar purchases can often be written off fully now.
– Maintenance & Repairs: Costs to fix or maintain business property (office repairs, software updates, vehicle servicing) are fully deductible. Don’t skip minor repairs—these expenses reduce taxable profit.
– Travel & Meals: Business travel (airfare, hotels, meals) is deductible, and so are client meals or local business trips (often at 50% deduction, depending on local tax rules). Keep receipts and note the business purpose of each trip or dinner.
– Rent & Utilities: Office rent, coworking fees, and utilities (electricity, internet, phone) for business locations are deductible. Home office costs can qualify too if you meet the criteria.
– Professional Fees: Fees paid to lawyers, accountants, consultants, or marketing professionals can be deducted. Also include software subscriptions and industry-specific dues—these count as ordinary business expenses.
– Payroll, Benefits & Bonuses: Wages, salaries, payroll taxes, and employer-paid benefits are deductible. Consider giving end-of-year bonuses or profit-sharing if you want to lower taxable profit this year. Retirement plan contributions (e.g. to a SEP IRA or 401(k) match) made by December 31 are also deductible.
– Interest & Insurance: Interest on business loans or credit lines is deductible—check your loan statements for total interest paid. Business insurance premiums (liability, malpractice, health plans for employees) also reduce income.
– Charitable Contributions: If your business can donate to charity, those gifts can yield deductions. Ensure donations meet any legal requirements and keep receipts.

Scanning your records with these categories in mind may reveal missed write-offs. Small expenses (like office supplies or software) add up, so account for everything.

“Our latest financial report highlights Execor’s strong growth, innovation, and commitment to delivering value. We remain focused on sustainable success and excellence."

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Timing Income and Expenses

Consider whether accelerating or delaying transactions could save tax. If you expect to be in a lower tax bracket next year, deferring some income into the next year might help. Conversely, you can prepay deductible expenses (like supplies or rent) in December to claim them now. For cash-method businesses, simply timing invoices and payments can shift tax liability. Check local rules, since some places allow prepaying certain expenses (insurance, subscriptions) to get the deduction early.

Additional Local Tax Relief Programs

Beyond deductions, look for tax credits and special incentives:
– Research & Development (R&D) Credits: If you invested in new products or processes, you might qualify for R&D credits. These directly reduce tax owed. Document any eligible projects and related costs.
– Energy or Investment Credits: Installing energy-efficient equipment or renewable energy (solar panels, for instance) may earn tax credits or allow extra depreciation.
– Loss Carryforwards: If your business had losses in prior years, make sure they’re applied to offset current profits (up to allowable limits). Carryforward losses can significantly lower taxable income.
– Carrybacks: Some jurisdictions let you carry losses back to prior years for refunds. If applicable, consult a tax professional about amending past returns for any refund.

Action Steps Before Year-End

Compile Documentation: Gather receipts, invoices, and bank statements for all business expenses. Without proof, deductions may be disallowed. Consider scanning receipts into a digital folder or your accounting software so nothing gets lost.
Review Local Tax Rules: Tax laws can vary by country or even by state/province. If you operate internationally, check any deadlines or rule changes in those jurisdictions. For example, some countries have special bonus depreciation rules or caps on deductions.
Consult a Professional: A tax advisor can spot deductions you might miss and warn of upcoming law changes. They can also help with items like foreign tax credits, sales tax, or payroll tax changes.
Finalize Payroll: If you plan to pay bonuses or make final retirement contributions, process them in time so the payment date is this year. Verify that payroll systems reflect any new minimum wages or tax rates for 2025.
Set Goals for Next Year: Use your review to set budgets and tax plans for the coming year. For instance, if hitting a higher income threshold triggers new taxes, plan accordingly. Early planning reduces surprises.

Putting in this effort now can yield significant savings. Use a checklist to tackle tax planning tasks in the fall or early winter. By being organized and proactive, you’ll claim every deduction and credit your business deserves, keeping more money in your pocket when tax season arrives.